Two Years Of Modi Govt | Civil Aviation Sector: Queued For Take Off

From a person-led to system-led and from always under media scrutiny to a low-profile status, the Ministry of Civil Aviation in the past 24 months of NDA rule has seen a sea change in how it was perceived between 2004-14 to how it is now. Under the low-profile and non-controversial minister - Ashok Gajapathy Raju - the Civil Aviation Ministry has seen a number of firsts added to its list of achievements, particularly in the past two year of NDA Government. Some of the important policy initiatives taken in the past 24 months are listed below:

Hiking FDI in Civil Aviation

On 10 November 2015, the NDA government relaxed the foreign direct investment norms for the civil aviation sector. Thus, the FDI by foreign airlines went up to 49 per cent in scheduled air transport service/domestic scheduled passenger airline/regional air transport service, up to 100 per cent in non-scheduled air transport services and 100 per cent for helicopter services/seaplane service permitted subject to certain sectoral regulations.

E-Office

Soon after taking over from the UPA-II government, the Modi government embarked on a big digital push within and outside the government. For internal governance, the Civil Aviation ministry saw the implementation of e-office where all the wings under the ministry like Directorate General of Civil Aviation (DGCA), Bureau of Civil Aviation Security (BCAS), Commission of Railway Safety (CRS) and Indira Gandhi Rashtriya Uran Akademy (IGRUA) came under a single URL of ca.eoffice.gov.in where all new files are generated electronically. This is a first indeed. As per the latest report, over 90 per cent files in the main ministry are being submitted through e-Office today. In the past 24-months, there was also the launch and implementation of single window clearance for all NOC for fixed wireless station operators who seeks clearance on radio frequency allocation from Airport Authority of India.

Draft National Civil Aviation Policy

In order to give direction for the next decade, the ministry came out with the draft national civil aviation policy twice. First in November 2014 and later a much refined version incorporating the earlier suggestions and recommendations on October 30, 2015. The mission of the Draft Civil Aviation Policy, the ministry had said back then, was to provide safe, secure, affordable and maintainable air travel with access to various parts of India and the world with an objective of enhanced regional connectivity, ease of doing business and promoting entire aviation sector chain from cargo, general aviation, aerospace manufacturing to skill development. It is pending Cabinet's nod which is expected anytime soon.

Push for Regional Air Connectivity

To achieve better regulation of air transport services to un-served and underserved areas, a draft policy on promotion of Regional and Remote Area Connectivity has also been finalized in the 24 months of the NDA Government in consultation with stake holders. The objective of the proposed Regional Connectivity Policy is to encourage airlines to operate in remote and regional areas by offering various concessions/incentives and at the same time, making it obligatory to fly to remote and intra remote areas.

Maintenance, Repair & Overhaul

For the first time in past decades, the ministry actually has got down to creating a conducive environment for the growth of Maintenance, Repair & Overhaul (MRO) industry to enhance the viability of MRO business. Airports Authority of India (AAI) has finalized its policy for allotment of land at concessional rate and exemption from royalty charged for MROs. Ministry of Civil Aviation is finalizing the National Civil Aviation Policy which includes development of MRO activities in consultation with Ministry of Finance, Department of Revenue and will focus on rationalization of the taxes and simplification of customs procedures to facilitate MROs.

In the Union Budget 2016-17, the government introduced various proposals for Maintenance, Repair and Overhaul (MRO) operations for airplanes. These include customs and excise duty exemption for tools and tool-kits used in MRO works. The government has also scrapped the one-year restriction for utilisation of duty free parts apart from allowing import of unserviceable parts by MROs for providing exchange. As per revised norms, the foreign aircraft brought in to India for MRO work would now be permitted to stay up to six months or as extended by aviation regulator Directorate General of Civil Aviation (DGCA). Such foreign aircraft would also be henceforth permitted to carry passengers in the flights at the start and end of its period of stay in India.

New Projects

New Integrated Terminal Building with capacity to handle 500 domestic and 200 international passengers at a time was commissioned and operationalized at Tirupati Airport on November 21, last year. Similarly, a new airport was formally opened up in Kadapa last July while a new terminal came up in Chandigarh in September followed by a new Terminal Building at Vijayawada in October 2015. An MoU was also signed between AAI and Singapore Cooperation Enterprise for Operations and Maintenance support of Ahmedabad and Jaipur Airports.

Development of International Air Cargo Hub at gateway airports in India has also been under implementation. Under the plan, airports will be developed as regional cargo hubs, integrating multi-modal transport facilities, cold chains and other commodity specific requirements. The turnaround time for cargo will be upgraded to international standards. RITES has already prepared and submitted a DPR for setting up of International Air Cargo Hubs at Delhi and Chennai Airports. CAT-II operations (landing at night and near zero visibility) have been started at Lucknow and Amritsar airport.

In the past two years of NDA rule, national carrier Air India joined Star Alliance on July 11, 2014. This was pending for over five years. With Air India Joining Start Alliance, its passengers are offered more itinerary choices to cover 1,269 destinations in 193 countries around the world.